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Gold/Mining/Energy : BET YOUR ASSAY - Mining Terms Explained -- Ignore unavailable to you. Want to Upgrade?

To: Henry Hooymans who wrote (317)	1/31/1998 11:30:00 AM
From: Walt	Respond to of 463

You are getting out of my area of knowledge on this one so hopefully someone who knows stocks will jump in here but I'll pass on a couple theories I was given about such big crosses. If a major investor in a company, for one reason or another wants to get out a broker may try to find a buyor or new investor for the whole lot. If they can do it all at once this saves both parties a whole lot of commisions. Sometimes if a person wants to do this they will ask the broker to find a single buyer or seller. There are also book keeping reasons to do it. Lets say Joes mining services had 125000 share of the company through a deal and wanted to change his company to JOE MINES LTD and wanted to transfer the shares over and for tax purposes had to have them do it at a recorded price then it would show up as a block trade. A third type of trade. Sometimes in deals between two companies one company agrees to buy shares in the other as part of a buisness agreement. So that shows up as a block trade. Im sure there are lots of other reasons for these large block trades but there are three possibilities. Hopefully someone will come up with some more. Regards Walt

To: Henry Hooymans who wrote (317)	1/31/1998 12:55:00 PM
From: Lilian Debray	Read Replies (1) \| Respond to of 463

Large cross are just transfers between accounts. They interest investors because they often indicate a coming movement in the share price. In speculative stocks, however, that movement may or may not reflect the value of the company. To take a shot at interpreting large crosses you really have to know the circumstances well and be very confident in your own DD. Some questions you could ask yourself and some possible answers: * Is that cross done through one of the houses used by the insiders? They may be: transfering shares from insiders accounts to a large investor when the market volume is low accumulating shares selling out shares supporting the stock * Is that cross done by a house that has the reputation of being a market maker for a category of stocks? That house may be: creating volume rounding up stock before a run up finding shares before selling a stock down walking a stock down to a chosen level walking a stock up creating price swings to shake out "skittish" investors giving the impression of a strong interest in the stock covering shorts * Is that cross a bundle of small trades made "upstairs" by a house and transferred electronically to the exchange as one big trade? TSE statistics show that the six brokerages that do the most volume cross 18 per cent of small trades --meaning they act as buyer and seller. These crosses, in turn, account for one-fifth of these companies' retail trading.